Brexit impact on rural Ireland
Deputy Harty asked how the new rural action plan would protect rural Ireland from a hard Brexit and pressed for a more independent negotiating line focused on agriculture and market access. The Taoiseach said the rural plan was comprehensive, acknowledged likely adverse economic impacts, and rejected the claim that the Government's approach was vague or unco-ordinated.
In regard to Brexit and its potential effects on the action plan for rural Ireland unveiled yesterday, which is a welcome recognition of what rural Deputies on all sides of the House have been seeking for many years, will the Taoiseach outline to the House how he envisages protecting rural areas from a hard Brexit, which appears to the model the British Government is to pursue, given the Prime Minister's speech last week? The United Kingdom's withdrawal from the European Union is the most pressing political, economic and social issue to be confronted and managed by Ireland in the next decade. Ireland is intimately linked to the UK in many ways, most particularly in respect of agriculture, which is the lifeblood of rural Ireland. Without a sustainable agricultural sector, the action plan for rural development will not succeed.
The comprehensive plan, with its 276 recommendations, is very welcome. It is a compendium reference document against which actions and implementations will be judged in the coming years. In the Taoiseach's words, there is something in the plan for everybody. It refers to rural-proofing Government decisions but does not address Brexit-proofing the agrifood industry. Our absolute proximity to, and substantial dependence on, the UK make Ireland very vulnerable to decisions that country will make solely with its own interests in mind. The requirements of the EU and Ireland are very far apart on this matter. Both the EU and the UK want a hard Brexit, but we want a soft Brexit.
Even before the UK triggers Article 50 of the Lisbon treaty, we in Ireland are feeling the effects of the uncertainty Brexit is causing, with a weakening sterling making the agrifood sector less profitable. It is envisaged that exports to Britain will fall by 30%, unemployment will rise and there will be a deepening regional inequality and a decline in economic growth. The agrifood industry will be the worst hit. Irish food exports have dropped in value by €575 million since the Brexit vote. The mushroom industry has all but collapsed, and beef, pigmeat and poultry exports will follow as the UK seeks cheaper imports from Brazil and Argentina. Our beef exports are 50% dependent on the UK market. Meanwhile, €10 billion of UK contributions to the Union's agriculture budget will be withdrawn, resulting in cuts to single farm payments to Irish farmers. Will the Taoiseach indicate the particular measures he intends to take to protect Ireland and the rural agriculture industry from Brexit?
Comment on this
Yesterday's publication of a comprehensive document to achieve the potential of rural Ireland, covering 600 towns and villages throughout the country, speaks for itself. The question is how that plan will be impacted when the shape of the new relationship between the United Kingdom and the European Union is eventually decided. All of the analysis carried out in economic studies by bodies and individuals, ranging from the ESRI, to IBEC, Teagasc and Professor Alan Matthews, indicates an adverse impact on the agri-economy in Ireland. The Deputy referred specifically to the mushroom industry and commodity pricing, the latter being of great concern to the Minister, Deputy Creed. In the short term, the immediate concerns for agrifood exporters centre on exchange rates and the significant drop in the value of sterling against the euro, which have created particular difficulties for sectors such as the mushroom sector that are relatively more exposed to the UK market. The Minister has made €150 million available in the form of low interest, long-term credit. Specific measures were included in the 2017 budget for implementation in 2018. In addition, Bord Bia has activated a four pillar strategy to deal with many of these issues.
There is a particular dependence on the UK market for sectors like horticulture and forestry and in respect of the sizeable quantity of product, such as butter, cheese and seafood, that is sent to the UK for further processing or packaging and returned for finishing, the ingredients that are sourced in the UK for incorporation into Irish products, the products transiting through the UK en route to European Union markets, the transnational producer organisations, the transport of horses for racing and sale, and the very significant Northern Ireland dimension.
These areas are all the focus of a forum set up by the Minister for Agriculture, Food and the Marine dealing with beef, pork, dairy and all these other sectors where there is a constant engagement. This is of exceptional interest to us here in Ireland given that we have a trade surplus in the agrisector of €1.3 billion with the United Kingdom.
The British Prime Minister, Mrs. May, having clarified some of the issues here, such as removing Britain from the Single Market, the question of the customs union and trading relationships is one that we will have to negotiate hard about and imaginatively in respect of our objectives. In that regard, from speaking to the Irish Farmers Association the other night, it recognises price commodity is an issue, as are many of the issues I have raised here. These are ones that we will focus on, through the Department of Agriculture, Food and the Marine and its agencies, as these negotiations begin to commence.
Comment on this
My main concern is the strategy which Ireland is taking in Brexit negotiations. Ireland needs to take an independent line rather than being tied exclusively to the pan-European negotiation stance which does not represent our unique interests and vulnerabilities, in particular, in agriculture. We must be proactive and strong in our critical demands at the negotiation table and be as forceful as possible.
Our strategy is vague and unco-ordinated. We may need to support some of the UK demands, particularly in access to UK markets for trade, services and customs. We may not be able to take a negative stance in that regard. We must ensure our unique relationship with Britain is recognised by our European partners.
I would put it to the Taoiseach that we need to have a clear leader to deal with Brexit. I would put it to him that we need a Ministry for Brexit, essentially devoted exclusively to our negotiations Department by Department, which would be consistent, single and focused.
Comment on this
I do not accept that the approach of Government has been vague and unco-ordinated. As I pointed out to Deputy Adams, the day after the vote was taken by the United Kingdom, we published a strategy to deal with that future. On 9 September last at the Oxford Union, I set out our priorities in detail. Our three pillar strategy is to continue to implement our programme for Government, to continue to manage the public finances well in the people's interests, and to continue to both grow employment and reduce unemployment. Yesterday's publication is to deal with 135,000 jobs in rural Ireland.
The second part is to have specific diplomatic negotiations with every Head of Government and the different Ministries at their councils in Europe. There is not a European country that does not know about our particular circumstances.
The third part is that when we start to negotiate, we will do so from a position of strength with a clear and comprehensive strategy. I have met quite a number of the leaders and will continue to do so until we have met them all separately from the European Council meetings. Our strategy is focused, strategic and co-ordinated. The game has not even started yet.